In this action, the Claimant ("Premier") and the Defendant ("Shell") seek to determine a dispute concerning the jurisdiction of a referee under two contracts.
The two contracts are for the sale of crude oil by Premier to Shell. One contract relates to the sale of crude oil from the Schiehallion oilfield, a deepwater oilfield approximately 110 miles west of the Shetland Islands in the North Atlantic Ocean ("the Schiehallion Contract"). The other contract relates to the sale of crude oil from the Clair oilfield located nearly 50 miles west of the Shetland Islands ("the Clair Contract"). The contracts are both dated 30 September 2019 and were originally entered into between Shell and Chrysaor Limited but were novated to Premier on 01 July 2021 in respect of the Schiehallion Contract and 17 August 2021 in respect of the Clair Contract.
As set out further below, the underlying dispute between the parties relates to changes to the detailed pricing structure under each contract. For the purposes of resolving that dispute, the parties have identified and appointed a referee in accordance with the dispute resolution provisions in each contract. The present Part 8 claim concerns the instructions to be given to the referee for the purposes of enabling him to exercise his decision-making powers. In brief, each of the parties is concerned that the other is looking to unduly influence the referee in exercising his powers under the contracts. Premier is concerned that Shell wishes to give guidance to the referee which will lead him to adopt a more restricted approach to the exercise of his contractual powers than the parties originally intended. In contrast, Shell is concerned that Premier is seeking to persuade the referee to undertake a more wide-ranging pricing review than the parties originally intended. As a consequence, the parties have been unable to agree terms of reference for the referee and now seek the assistance of the court.